Wednesday, May 1, 2019
LegalZoom Founder Brian Liu Talks About His New Legal Startup, BizCounsel
What's the best way to get legal advice, if you're a small business? Brian Liu, the co-founder and CEO of a new startup, BizCounsel, was the co-founder of LegalZoom, and thinks there can be a new way that every business owner can get access to dedicated business attorneys for legal work. The startup offers up legal advice for just $65 per month for small business owners, matching them with business attorneys for legal work and one-on-one advice. We caught up with Brian to hear more about the startup.
What you are up to with this new company?
Brian Liu: We're launching a new business, BizCounsel, which looks a lot like the big brother for LegalZoom. Essentially, we're empowering modern business attorneys. What I realized, when we started LegalZoom 18 years ago, is there were lots of instances where simple legal documents were enough for people, where they could do those legal filings on their own. However, there was another set of things which still needed to be done by a lawyer. There isn't a solution available for those, at least, not an affordable, modern solution where you need a little bit more help. Eighteen years after we founded LegalZoom, the practice of law hasn't changed much for the attorneys. Pretty much the only thing that has changed is the price, and they're charging more. I thought it was about time to do something about that, to make sure small business owners—not just multi-million and billion dollar, Fortune 500 companies—could have access to all of the benefits and protection of the law.
What is it that you're doing here, that you weren't able to do at LegalZoom?
Brian Liu: The main thing we're doing, is changing the way the business owners and lawyers interact. We're changing up the business model. It's a new way to establish a relationship with a modern business lawyer, which is what we aren't able to do before. LegalZoom might have a legal plan, but it's more or less transactional in nature. It's not about establishing a relationship with a lawyer. What we're saying, is this is a new way to establish a relationship with somebody you can call your lawyer. The traditional model of how lawyers have worked has always been very transactional in nature. You only call them typically when you need some particular thing done, like a big contract, or some major corporate transaction. That's when you have to find a lawyer. They then require a big, upfront retainer. That has made it very difficult for business owners who didn't have tens of thousands of dollars to establish an ongoing, continuing relationship with a lawyer. That's what we're trying to fix.Why not just do this at LegalZoom? Why did you start this as a new company?
Brian Liu: I think, with a new company, there are two things you always key. I think you've seen this a lot. One, it's about putting a new perspective on things. Sometimes, when you're in a big corporate environment, there are certain corporate goals and things you need to do. It's hard to come up with something completely from scratch. That's just not what bigger companies do best. Innovation happens a lot more when you have a startup, with a new attitude and new blood. That's not just the case in LegalZoom, but many companies all around the world. I was at LegalZoom until last year, and I was the CEO of the company for its first seven years, from 2000 to 2007. I was Chairman until last year. I thought, as I was leaving, how can I still do things in the legal space, and do something complementary to what LegalZoom is doing.
You probably could have just retired or become an investor after LegalZoom, what drove you to actually roll up your sleeves and run a startup again?
Brian Liu: I think it's two things. One, is it is not in my nature to not be involved in the day to day of the business. At one point at LegalZoom, I stepped away from day-to-day duties, and spent some time developing real estate. I will tell you, I was miserable. I was really miserable. That's when I realized I have to do something active. That's one thing, is I realized I can't stop working. It's funny, because I had always dreamed of being successful enough to go surfing all the time. My passion was surfing. After the success at LegalZoom, I said, you know what, I am going to spend the next two years traveling the world, going to the best surf sports. I ended up doing that for a couple of months and coming back to work. It was fun, but when I was done with it, I figured out I didn't need to do that for two years.
Interesting, did you ever think you'd come to that decision so quickly? It seems almost every entrepreneur has some dream of retiring and not having to ever work again.
Brian Liu: Everyone has to got to chase something, a dream. Some people want a Ferrari, some people want a private jet. I wanted a life of leisure and surfing. But, the when you end up catching whatever it is you want, and now that you've caught it, you have to figure out what's next. Everyone is different, everyone has different motivations. It's whatever ends up driving people.
So where is BizCounsel now, and where is the service at the moment?
Brian Liu: We're in our Alpha launch right now, and we're expanding into eight different states. But, it's still very early in the game. We're ramping up, and we're essentially gearing up for a real public launch, which is going to happen very soon.
I know it's early, but what's your biggest challenge so far, in shaping the company?
Brian Liu: The challenge here is interacting with different attorneys, and getting them to buy into this model, and buy into this vision. It's been a little more challenging than I thought. There's no precedent to what we're doing. We've taken some existing business models that we thought parallels what is out there. But, the reality is, this is 80 to 90 percent different kind of a service, with the clients we're attracting, how we sell this, and how we deliver. I though this would be more similar than dissimilar to what we were doing at LegalZoom. I just thought there would be more of a marketing spin, but it's not. It's more about product differentiation.
What has been your most successful approach with talking to attorneys about what you offer?
Brian Liu: The good thing, and what has changed a little with the legal profession, is there are a lot of newer, younger attorneys, who are interested in changing the profession. They just don't know how. We're giving them a path and a vehicle to essentially build a different type of practice. Obviously, you want to have lawyers who are open to the conversation, and who are willing to try new things. Not everyone, obviously, is an entrepreneurial lawyer. However, there are a few out there. The biggest challenge, is finding them.
Finally, what's next, and what should we be watching?
Brian Liu: The big thing for us is a public launch. There are really three phases of the practice of law we're trying to modernize. One, is the structure of the business itself, the business model. As I said before, everything right now is on a transactional basis. The idea that everyone is following, is trying to get a few large clients. That's true for small business lawyers. If they can get $10,000 to $15,00 a year in fees from those clients, and they get fifteen of them, that's a pretty good living for that year. That's been the goal so far, and their economic model. What we're trying to do, instead, is allow them to serve more people, and do more things by charging a lower amount, providing technology infrastructure, and modernizing their infrastructure and marketing.
One of the legal management companies, Clio, put out a study not more than a year ago saying that the average small business spends an hour and a half a day dealing with billing and collections. That's a very inefficient use of time. That's one of the reasons the whole way practices are managed is broken. We're modernizing that, and filling people's time up with useful, billable work, rather than having them wasting time or doing administrative follow up. We're making sure their books are full, that they can deliver a lot more services to a lot more clients out there. What we found, similar to LegalZoom, is you have a lot of people, even small businesses, who are still trying to do this on their own. They just don't have a “go-to” source for legal help. We're trying to be that “go-to” source, and that's really the vision of where we're going.
Here's something else that might be interesting to people here, is everyone know there are a lot of technology incubators out there. The big example is YCombinator. We've found, surprisingly, that there are a lot of startups coming to us for this, because they have the same concerns and needs. Maybe they didn't get into YCombinator, they didn't get any credits to spend with Wilson Sonsini or Cooley, but they just don't have that kind of money to spend on startup documents. Maybe, they have the vision for a good company, but they're just not the next Facebook, so they couldn't make it into the top incubators. The number of startups in California who could use this is staggering. They need the legal help, but the big firms, who are great for what they do, just can't help them all.
Thanks, and good luck!